[Graph courtesy:opensecrets.org]
Newly freed from the government’s controlling interest, GM is turning the tables back on the government by accelerating its lobbying efforts some 83 percent in the third quarter of this year. GM spent $2.72m on lobbying in the second quarter of this year, and $2.49m in the third quarter, a massive increase over the $1.36m GM spent in the third quarter of last year (Chrysler spent $846k last quarter). Bloomberg reports
The Detroit automaker had nine registered lobbyists speaking with federal agencies and Congress on free trade agreements, distracted driver legislation, tax credits for electric vehicles, pension legislation, climate change bills [as well as] Wall Street reform; fuel economy regulations; U.S.-Asia trade; pending free trade agreements with South Korea, Colombia, and Panama; funding for renewable fuel research; defense spending; emergency response privacy regulation; event data recorders; pedestrian safety and other issues
But let’s be real about something: some of these issues are just a little more important than others….
As usual, the industry would like to keep its agenda safely away from prying eyes, instead allowing the Center for Automotive Research to lay out the game plan. CAR’s Sean McAlinden tells Forbes that increasing fuel-efficiency standards are the major concern facing the industry.
CAR warns that if that happens, the new standards could wind up having an unintended effect by putting the cost of a new vehicle out of reach for many Americans and encouraging them to keep their older, polluting cars longer. If cars are required to get an average of 60.1 miles per gallon by 2025, for instance, the average price of an automobile would rise about $8,000, CAR estimates. Add another $1,500 to $3,000 per vehicle for new mandated safety equipment like back-up cameras (proposed for 2014), brake override systems (a consequence of Toyota’s gas pedal crisis) and the price of a car quickly escalates.
That would have a devastating impact on sales and profits within the auto industry, predicts McAlinden. “The industry loses five million sales a year, three million units of production, and 222,000 jobs, while the U.S. economy loses 1.3 million jobs,” he says. “And we begin to look like the Cuban auto market, with people keeping their current cars for 20 years and more.”
Needless to say, this has all the highlights of the industry’s lobbying talking points, right down to scaring lawmakers with the specter of a US car market that resembles Cuba’s sanction-starved time capsule. Meanwhile, Detroit’s alleged “transformation” to the willing leaders of a green car revolution is looking even more suspect. Luckily the news isn’t all bad: according opensecrets.org, GM doesn’t seem to be using its political contributions to punish or reward lawmakers based on their bailout votes. Still, the administration that promised transformation from the US auto industry can’t be happy about its continued opposition to fuel economy standards. Perhaps this will be yet another prompt to bring back discussion of a gas tax hike, rather than continued reliance on the convoluted and ineffective CAFE system.
As Paul Nierdermeyer showed, there’s nothing wrong with “people keeping their current cars for 20 years and more.” Although a couple are paranoid about aliens, and others are a little touchy about having their rides photographed…
So just a few weeks ago there was a problem with too much government control of GM and now its too much government control by GM? Really?
Can I ask an obvious and pertinent (rhetorical) question, here?
Why should my taxpayer monies (taken from me by force against my will) and given to Generous Messup – be recycled back to the crooked politicians who were responsible for stealing the money to hand over to GM in the first place, in order for GM to “garner favor” with them?
I’m just kind of wondering, that’s all.
So you can get your money back.
Now how are we going to get all the money back from foreign aid?
How does this compare to other automakers who are lobbying in for or against the same thing? Looking at it as only one company skews the results.
+1. All the auto companies lobby. (every sub-specialty of business has it’s own lobby) They’d be nuts not to.
+1. All the auto companies lobby. (every sub-specialty of business has it’s own lobby) They’d be nuts not to.
As the past has shown us, we’d be surprised to see who’s lobbied against higher fuel mileage standards. And not all of the opposition was based in Detroit.
How many lobbyists does AIG have? Bank of America? Let’s keep this in perspective.
At least you didn’t blame lobbyist activities on the big, bad Union.
During my time with the General, salaried employes (sic) were required to give to the Republican party, as in deducted.
william442:
Isn’t (wasn’t) that illegal? Did anyone challenge that? I wouldn’t give to ANY political party. Or was that a condition of employment? I’d like to know more about that little item.
As best I remember, we just did it. As a senior executive with a leading bank, it was the same deal.
I think the federal government should stop all of this foolishness with regulating fuel economy. Ever since they started doing it, there have been unintended consequences. The reason, I believe, that people are driving SUV’s that get less than 15mpg is that the government outlawed full sized cars that got less than 20. I am also against punitive gas taxes. We already have punitive gas taxes in the form of farm subsidies for gasoline that is less potent and gets less mpg. Ethanol is a robber of my hard-earned money on both ends. Let the market decide how much gas should cost, what type of gas should be available and how cars should be built. It is in the government’s self-interest to do so. If automakers were allowed to function in a pre-1973 regulatory structure, the companies would be able to sell more car for less money. The gov’t’s share in GM and Chrysler would be more valuable and those companies might be able to break free of the bailouts.
Forget gas taxes and CAFE standards, are they seriously considering mandating back-up cameras? Isn’t this idea WAY beyond the point of diminishing returns for whatever miniscule number of accidents this might prevent?
Who’se proposing this, the manufacuturers of in-car LCD screens? How much are they spending on lobbying efforts? Only kidding, partially.
By the way, your chart shows PAC donations but the article talks about lobbying efforts, aren’t these totally different things? And, to paraphrase Casablanca, I would be shocked to learn that political cash donations actually sway votes more than mere “lobbying.”
GM would do well to put that money towards R&D and producing cars consumers want to buy. Its the consumers GM should be lobbying.
Sean,
Cuban cars are 50-60 years old, not 20.
CarPerson